Running Daily Stock Backtests with Yahoo Data in LumiBot

# backtesting.yahoo


.. _backtesting.yahoo:

Free Daily Stock Backtesting with Yahoo and LumiBot
===================================================

.. meta::
   :description: Run free daily stock and ETF backtests with Yahoo data in LumiBot without broker credentials, then inspect trades and performance reports.

**NOTE: Please ensure you have installed the latest lumibot version using ``pip install lumibot --upgrade`` before proceeding as there have been some major changes to the backtesting module in the latest version.**

Yahoo backtesting is so named because we get data for the backtesting from the Yahoo Finance website. The user is not required to supply data. Any stock information that is available in the Yahoo Finance API should be available for backtesting. The Yahoo backtester is only for stock data (including ETFs). Additionally, you cannot use the Yahoo backtester for intra-day trading, it is for daily trading only. For other securities, use the Polygon or Pandas backtesters.

For a complete AI stock example, see :doc:`the bull/bear large-cap team
<agents_example_bull_vs_bear_ai_stock_trading_bot>`. Yahoo daily bars cannot supply the
09:30 to 09:45 evidence required by the :doc:`opening range breakout
<agents_example_opening_range_breakout_ai_trading_bot>` tutorial.

Using Yahoo backtester, you can also run backtests very easily on your strategies, you do not have to modify anything in your strategies.

To use the Yahoo backtester, you must import the ``YahooDataBacktesting`` and ``BacktestingBroker`` objects.

.. code-block:: python

    from lumibot.backtesting import BacktestingBroker, YahooDataBacktesting

To run a backtest, you must create a ``YahooDataBacktesting`` object, then pass it to the ``BacktestingBroker`` object. The ``BacktestingBroker`` object is then passed to the ``Strategy`` object. Finally, the ``Strategy`` object is passed to the ``Trader`` object and the backtest is run.

There are also several plots that are generated by the backtester. These plots are by defaults saved in the ``logs`` folder.

Option 1: Provide Start and End in Code
---------------------------------------

.. code-block:: python

    from datetime import datetime

    from lumibot.backtesting import BacktestingBroker, YahooDataBacktesting
    from lumibot.strategies import Strategy
    from lumibot.traders import Trader

    # A simple strategy that buys AAPL on the first day
    class MyStrategy(Strategy):
        def on_trading_iteration(self):
            if self.first_iteration:
                aapl_price = self.get_last_price("AAPL")
                quantity = self.portfolio_value // aapl_price
                order = self.create_order("AAPL", quantity, "buy")
                self.submit_order(order)

    # Pick the dates that you want to start and end your backtest in code
    backtesting_start = datetime(2025, 1, 1)
    backtesting_end = datetime(2025, 1, 31)

    # Run the backtest
    result = MyStrategy.run_backtest(
        YahooDataBacktesting,
        backtesting_start,
        backtesting_end,
    )

Using Environment Variables (Optional)
--------------------------------------

You can set the following environment variables without making any changes to your code. **LumiBot will automatically use them if they are set.** If they are not set, LumiBot will default to normal behavior (i.e., you can specify the start/end in code as above).

Below is a table describing these optional environment variables:

.. list-table::
   :header-rows: 1
   :widths: 20 60 20

   * - **Variable**
     - **Description**
     - **Example**
   * - IS_BACKTESTING
     - (Optional) Available to startup code that explicitly checks it. It does not change a ``run_backtest()`` call into a broker run; see :doc:`strategy_run_modes`.
     - False
   * - BACKTESTING_START
     - (Optional) The start date for backtesting in the format "YYYY-MM-DD". Only needed if you are backtesting.
     - 2025-01-01
   * - BACKTESTING_END
     - (Optional) The end date for backtesting in the format "YYYY-MM-DD". Only needed if you are backtesting.
     - 2025-01-31

Examples of how you might set these variables:

- **Render / Other Cloud**: Define Environment Variables in your service’s dashboard.  
- **Repl.it**: Add them to your project’s “Secrets.”  
- **Local Development**: Create a `.env` file (or set them at the OS level).

Option 2: Rely on Environment Variables (No Start/End in Code)
--------------------------------------------------------------

Below is an example strategy that **omits** `backtesting_start` and `backtesting_end`:

.. code-block:: python

    from lumibot.backtesting import BacktestingBroker, YahooDataBacktesting
    from lumibot.strategies import Strategy
    from lumibot.traders import Trader

    # A simple strategy that buys AAPL on the first day
    class MyStrategy(Strategy):
        def on_trading_iteration(self):
            if self.first_iteration:
                aapl_price = self.get_last_price("AAPL")
                quantity = self.portfolio_value // aapl_price
                order = self.create_order("AAPL", quantity, "buy")
                self.submit_order(order)

    # This call always backtests. BACKTESTING_START and BACKTESTING_END
    # can supply the dates when they are omitted here.
    result = MyStrategy.run_backtest(
        YahooDataBacktesting
    )

This example calls ``run_backtest()`` in every case. ``BACKTESTING_START`` and
``BACKTESTING_END`` can supply omitted dates; ``IS_BACKTESTING=false`` does not
start broker execution. See :doc:`strategy_run_modes` for the separate broker
runner.